The Free? Trade Area of the Americas

The project to create a continental market benefits only the US largest corporations

In November this year, the Southern US city of Miami will hold a new conference on the future of the Free Trade Area of the Americas - FTAA or ALCA in Spanish -. The intention of the US officials is to put more pressure on Latin American representatives to speed up the integration process.

US diplomats in Latin America are entitled to urge local Governments to have a favorable view on the question and adopt an active policy on the process. However, more and more voices inside and outside USA are rising against what the Brazilian President Lula Da Silva once considered "mere annexation" by Washington.

Notwithstanding, little has been explained on what really FTAA means and who benefits from the treaty. In practical terms, the FTAA is an extension of NAFTA to all Latin America from Guatemala to Argentina.

The program as it is today has five main characteristics. The main concept is Freedom of Trade, which means that all the countries will lift up limits to the import of goods. Analysts consider that it will have a serious impact on Latin American economies, as they will be compelled to produce only agricultural products.

Another key issue is the free access to the national markets. It means that goods and capitals will be considered nationals in any country member of the agreement, no matter where do they come from. Therefore, local Governments won't be allowed to promote local industries and to benefit them on public purchases.
The freedom of trade includes basic services, such as health-care and education. It means that in those areas, the public sector will be entitled to act only in the same way as the private corporations do it, to ensure fair competitive rules.

Additionally, national governments' decisions will be subject by warrants to the foreign investors. If one investor considers that a governmental regulation violates its interests, can prosecute those authorities before an international court. Such organism is to be composed by trade experts entitled to rule secretly. This seriously affects the national sovereignty of the State, as it will be unauthorized to rule on the benefit of the public.

In the opinion of Tom Hayden, Former State Senator of California and a well-known anti-globalization activist, the FTAA is a "NAFTA expanded". As NAFTA has failed in Mexico, driving up unemployment and finishing with country's middle class, there is no reason to think that the FTAA will succeed in the rest of the countries.

While serving in the California's Legislature, Hayden experienced NAFTA institutions: "I was chairman of the Natural Resources Committee of the California Senate. We had a gasoline additive that was leaking from the underground tanks to the drinking water. So I carried legislation to stop it. Eventually the California State stopped it. Then, the multinational company based in Canada went to the WTO asking for a $ 900 million compensation, which was their estimate of the profits they would lose from California trying to protect its water supply."

Therefore, the State could not sue the company for the poisoning of the water, but they could sue California for the lost of their profits from pollution. The case went to a WTO court, where three judges were appointed: one from Canada, one from Mexico and one from the USA. Hearings are secret, no reporters are allowed and no appeals can be made. The conclusions are yet to be released.

This sole example explains how FTAA or ALCO may work once established. Only benefits for the multinational companies and not a single word on cultural or politic integration, democracy or human rights. A n advance of the multinationals against people's interests.

Hernan Etchaleco

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Author`s name Olga Savka